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Australia, the magazine : Australia, the magazine
77 inbound investment Singapore's listed tele- communications giant, Singtel, made the biggest acquisitions in corporate Australian history when it paid AU$13 billion for Optus in 2001. e purchase from US giant, Cable and Wireless surprised market watchers, as Optus was the second biggest telecommunications operator in Australia and ba ling a former government monopoly in Telstra. But, as far as Singtel was concerned, it was a logical move. "Australia is one of the largest telecommunications markets in the Asia-Paci c region and one of the four regional hubs which includes Singapore, Hong Kong and Japan. at made Optus a good t for the enlarged Singtel Group across the Asia-Paci c group," says Singtel company spokesperson Michele Batchelor. "Today Optus contributes about SG$1 billion in free cash ow a year and 29 percent of proportionate earnings before interest, tax, depreciation and amortisation (EBITDA) to the Singtel Group.'' For Singtel, the cross-fertilisation of ideas, sta exchanges and operations know-how were some of the key bene ts of the acquisition once Optus was integrated into the corporate culture of the parent company. "Both Singtel and Optus have bene ted and learned from each other,'' says Batchelor. "For example, Optus had more capabilities in developing the mobile pre-paid business and Singtel has learned and used that to improve our mobile business in Singapore. In turn, Singtel brought nancial discipline to Optus and Optus also picked up Singtel's lean program for improving business processes. In addition, there is constant exchange of sta , including successfully deploying senior-level management across Singapore and Australia.'' SINGAPORE CALLING ❝Optus is a good fit for the Singtel Group.❞ -- Michele Batchelor be the US private equity company, Lotus Ventures of California, a keen investor in bioenergy and agribusiness start-ups. Lotus is the biggest shareholder with 40 percent. Construction work has already started on the plant in Wagga Wagga, NSW, which will be capable of crushing 170,000 tonnes of oilseed and refining 65,000 tonnes of oil a year for export to food companies in India, Asia, Japan, US and Europe. There are also plans to produce 105,000 tonnes of vegetable protein meal for use in Australia's dairy, poultry and animal feed industry. Production is expected to start before the end of this year. "Our project will contribute to about 200 construction jobs and 500 indirect jobs. This venture could also be a catalyst for other industries to invest in the region.'' Saxena has been impressed with the scientific community in Australia, in particular the help of CSIRO's Dr Rod Mailer from Wagga Wagga. "The level of institutional support especially from industry bodies has been very good and the level of competency has been particularly high," he says. Saxena says that when the plant is in full operation, the business expects to turn over AU$150 million in two to three years' time with the potential to expand into a AU$500 million business. "We have plans to invest another AU$40 million over the next three years -- depending on how this goes -- and we will be in the market to make acquisitions in food or transport-related companies,'' he says. And,ifhehadtodoitover again, he would still choose to invest in Australia. SINGTEL' S INVESTMENT IN OPTUS WA S A LOGICAL MOVE. iStock